1- The income statement for the year 2011 of Poole Co. contains the following in
ID: 2346900 • Letter: 1
Question
1- The income statement for the year 2011 of Poole Co. contains the following information:Revenues $70,000
Expenses:
Wages Expense $45,000
Rent Expense 12,000
Advertising Expense 6,000
Supplies Expense 6,000
Utilities Expense 2,500
Insurance Expense 2,000
Total expenses 73,500
Net income (loss) $(3,500)
The entry to close Income Summary to Retained Earnings includes
Answer
A. a debit to Revenue for $70,000.
B. credits to Expenses totalling $73,500.
C. a credit to Income Summary for $3,500.
D. a credit to Retained Earnings for $3,500.
2- The following describes the process of identifying the economic events of an organization
Answer
A. Keeping a chronological diary of particular events in an orderly and systematic manner.
B. Selecting the economic activities relevant to a particular organization.
C. Preparing accounting reports, including financial statements.
D. Quantifying events in dollars and cents.
Explanation / Answer
1.B. credits to Expenses totalling $73,500 2.A. Keeping a chronological diary of particular events in an orderly and systematic manner.
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